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AUD/USD Currencies

Australian Dollar Fails to Maintain Gains as Subdued Trading and US-China Trade Tensions Mount

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  • April 18, 2025
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The Australian Dollar (AUD) was subdued on Friday despite positive signals from US President Donald Trump about the possibility of reaching a trade agreement with China that would be sealed within the next three to four weeks. While the AUD/USD currency pair had been on a seven-day winning streak, trading volumes were subdued on account of the Good Friday holiday, and worries regarding the economic effects of tariffs on the US kept the US Dollar under pressure. Even these events notwithstanding, the Reserve Bank of Australia’s conservative approach to future interest rate moves and mixed economic data, such as a marginal increase in Australia’s unemployment rate, dented the AUD’s performance. The duo is trading close to the psychological 0.6400 mark, as market players anxiously await developments in further trade talks and signs of global economics. KEY LOOKOUTS • Market players will keenly watch any advancement in the US-China trade talks, especially if a trade pact in the coming three to four weeks is imminent, as it would have a bearing on the AUD, given Australia’s healthy trade relationship with China. •  US Consumer Price Index (CPI) data and labor market indicators, such as jobless claims, will be instrumental in determining the direction of the US Dollar. Better-than-anticipated data might favor the USD, which may cap AUD gains. • Reserve Bank of Australia’s conservative stance towards interest rate actions and its evaluation of economic uncertainties will be instrumental for AUD movements. The rate of future rate cuts, if any, and their size might affect investor attitudes towards the currency. • Being Australia’s biggest trading partner, China’s economic performance—e.g., GDP growth, industrial production, and retail sales—will keep influencing the AUD, especially with the recent optimistic growth in China’s economy surpassing expectations. The Australian Dollar (AUD) was downbeat on Friday despite encouraging news from US President Donald Trump regarding the possibility of a trade agreement with China within the next few weeks. Trading was generally subdued on account of the Good Friday holiday, with market players monitoring the on-going US-China trade talks and their possible influence on the global economy. Though the AUD had been on a seven-day rising streak, the Reserve Bank of Australia’s cautious approach to interest rate hikes and mixed economic indicators, such as a marginal increase in unemployment, kept its performance subdued. The AUD/USD currency pair is trading around the psychological level of 0.6400, and the direction is still unclear as market participants wait for further news in both international trade negotiations and local economic indicators. The Australian Dollar (AUD) was subdued despite hope from US-China trade negotiations, with market activity slowed down by the Good Friday holiday. The AUD/USD currency pair fluctuates around the 0.6400 level, confronted by conflicting economic indicators and ambiguity both from world trade negotiations and local statistics. •  The Australian Dollar (AUD) remained sedate despite encouraging news from US President Donald Trump on US-China trade negotiations. • The trading activity was muted by the Good Friday holiday, diminishing volatility in the markets. • Trump remained hopeful that the United States and China could reach a trade agreement within three to four weeks, something that could impact the AUD. • The US Dollar (USD) was weakening with fears over the economic effects of tariffs and inflation risks. • The latest minutes of the Reserve Bank of Australia reflected continued uncertainty regarding interest rate changes in the future. • The unemployment rate of Australia increased marginally to 4.1%, while employment change was below expectations, which further created uncertainty regarding the AUD. • The AUD/USD currency pair is around 0.6400, with important resistance at 0.6408 and support at 0.6311, reflecting likely price action. The Australian Dollar (AUD) registered minimal movement despite a positive comment by US President Donald Trump regarding the possibility of a trade agreement with China. Trump was optimistic that a trade deal would be reached within the next three to four weeks, which increased expectations of a positive effect on global trade. Nevertheless, market activity was quiet because of the Good Friday holiday, which decreased trading volumes and volatility. AUD/USD DAILY PRICE CHART CHART SOURCE: TradingView Against these events, the Reserve Bank of Australia (RBA) adopted a prudent view regarding the nation’s economic scenario. Although recent economic statistics reported varied results, including a modest rise in the jobless rate and less-than-anticipated change in employment, the RBA reiterated uncertainty over upcoming interest rate decisions. Consequently, the performance of the AUD continued to come under stress, as traders keenly observed global trade talks along with domestic economic readings. TECHNICAL ANALYSIS Australian Dollar (AUD) against the United States Dollar (USD) is exhibiting a bullish inclination, with the AUD/USD pair trading above its nine-day Exponential Moving Average (EMA) and the 14-day Relative Strength Index (RSI) remaining above the neutral 50 level. These signals indicate positive short-term upward momentum. Yet, the pair is confronted with crucial resistance around the psychological 0.6400 level, with additional hurdles at the four-month high of 0.6408. On the negative side, the nine-day EMA at 0.6311 and the 50-day EMA at about 0.6283 serve as immediate support levels, which may assist the pair in holding its present range unless there is a major break below these levels, which may indicate a change in market sentiment. FORECAST The Australian Dollar (AUD) may experience upward momentum if US-China trade negotiations move in a positive direction. Any major breakthrough in the trade deal, as suggested by US President Trump, would be a positive boost for global sentiment and Australia’s economy, given its robust trade relationship with China. Also, if the Reserve Bank of Australia (RBA) delays rate cuts, it would bring some stability to the AUD. Better-than-expected economic reports in Australia, like firm employment numbers or a decrease in the rate of unemployment, may also continue to boost the currency’s potential for gains. Downside threats to AUD come from overall global uncertainties, especially if US-China trade talks breakdown or do not yield an agreement. Deteriorating US Dollar, as a result of persistent inflation and economic issues, could

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AUD/USD Currencies

Australian Dollar Consolidates Strength on Economic Data and US Dollar Weakness as Major Events Loom

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  • March 5, 2025
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The Australian Dollar (AUD) continues to consolidate its strength as the US Dollar (USD) stays weak in the face of economic uncertainty and the pending major data releases. Australia’s GDP growth beat forecasts in Q4 2024, bolstering confidence in the economy, while China’s better-than-expected Services PMI further underpinned the AUD. On the other hand, the US is grappling with rising trade policy concerns as Commerce Secretary Howard Lutnick signaled potential reappraisal of Trump’s tariffs that have already influenced market mood. The AUD/USD pair is quoted around 0.6260, with technicals indicating support at the nine-day EMA and potential downward risks if major support levels are breached. While the market waits for the US ISM Services PMI and ADP Employment Change, AUD’s strength is once again the currency market focus. KEY LOOKOUTS • Australia’s Q4 GDP grew 0.6%, beating forecast, affirming economic strength and backing the Australian Dollar during global uncertainty. • Commerce Secretary Lutnick suggested President Trump is considering reversing recently raised tariffs, injecting uncertainty into the US Dollar and affecting market sentiment. • China’s Services PMI rose unexpectedly to 51.4, signaling steady economic growth and offering indirect support to the AUD through trade relations. • The upcoming ISM Services PMI and ADP Employment Change could influence the USD’s trajectory, shaping short-term movements in the AUD/USD pair. Traders are closely watching key economic and policy developments impacting the Australian Dollar and US Dollar. Australia’s better-than-anticipated Q4 GDP growth of 0.6% has strengthened optimism in the economy, while China’s better Services PMI indicates stable growth, indirectly benefiting the AUD. In contrast, uncertainty surrounds US trade policy, with Commerce Secretary Howard Lutnick hinting that President Trump might roll back recently imposed tariffs, creating market volatility. With the US ISM Services PMI and ADP Employment Change due for release, investors are weighing the possible influence on the USD, which is still under pressure. These factors combined determine the short-term direction of AUD/USD, with traders keeping an eye on technical support and resistance levels. Australia’s robust Q4 GDP expansion and China’s better Services PMI underpin the Australian Dollar, while uncertainty surrounding US tariff policy continues to keep the USD under pressure. Market participants are looking for pivotal US economic data releases, including ISM Services PMI and ADP Employment Change, to gauge the influence on AUD/USD momentum. • Q4 2024 GDP expanded 0.6% QoQ, above market expectations and further underpinning economic resilience. • The USD is under pressure with market sentiment weighed down by economic uncertainties and trade policy issues. • Commerce Secretary Lutnick hinted Trump might revisit recently imposed tariffs, injecting volatility in the forex market. • The sudden spike to 51.4 indicates consistent economic growth, implicitly backing the Australian Dollar. • Speculators look out for confirmation of releases of major US economic data to determine the short-term direction of the USD. • The two trade close to 0.6260, with support at 0.6271 (nine-day EMA) and possible downside towards 0.6187. • Global trade uncertainty and economic data continue to play a crucial role in driving movements of the forex market, determining AUD/USD trends. The Australian Dollar continues to be strong amidst major economic events and international trade uncertainties. Australia’s GDP growth of 0.6% in Q4 was above market forecasts, indicating the strength of the economy despite global difficulties. Also, China’s better-than-anticipated Services PMI at 51.4 indicates consistent growth, indirectly favoring the AUD because of robust trade relations between the two countries. In the meantime, the Reserve Bank of Australia (RBA) is still evaluating economic risks, with policymakers keeping a close eye on inflation and labor market performance to inform future monetary policy. AUD/USD Daily Price Chart Chart Source: TradingView On the international side, US trade policy continues to be a pressing issue, as Commerce Secretary Howard Lutnick suggested that President Trump might revisit the recently levied tariffs. The uncertainty surrounding the trade actions has caused apprehension regarding their long-term effects on economic growth and global trade patterns. Additionally, the US suspended all military assistance to Ukraine, creating yet another layer of geopolitical stress for the market. While investors wait for major US economic releases, such as ISM Services PMI and ADP Employment Change, sentiment in the market is subdued, with attention to economic stability and policy guidance. TECHNICAL ANALYSIS AUD/USD currency pair is trading around 0.6260, with sideways action as the market conditions are evaluated by traders. The pair has immediate resistance at the nine-day Exponential Moving Average (EMA) of 0.6271, and a stronger resistance at the 50-day EMA of about 0.6303. The Relative Strength Index (RSI) is still below 50, which reflects a risk-averse market sentiment with weak bullish pressure. On the negative side, the major support is at 0.6187, the four-week low seen on March 5. A fall below this level might trigger further drops to 0.6087. With future US economic data releases, AUD/USD price movements might experience greater volatility, impacting short-term technical trends. FORECAST The Australian Dollar (AUD) can witness further gains if economic data keeps supporting positive sentiment in the market. With Australia’s Q4 GDP beating forecasts and China’s economic data indicating resilience, the AUD has fundamentals to support gains. If risk sentiment remains steady globally and US economic worries continue, the AUD/USD currency pair can challenge resistance around 0.6300 in the near future. Also, any signals from the Reserve Bank of Australia (RBA) regarding holding or changing monetary policy could affect investor sentiment and add more support for the currency pair. Downside-wise, the AUD/USD pair remains susceptible to external threats from US trade policy and economic uncertainty in the world. If the US Dollar strengthens on more robust-than-anticipated economic news or a change in Federal Reserve policy expectations, the pair might experience fresh selling pressure. A breakdown below the key support of 0.6187 would initiate a more severe pullback to 0.6087, the lowest since April 2020. Also, geopolitical tensions, including the US suspension of military assistance to Ukraine, may enhance market volatility, which would trigger risk-off sentiment to weigh on the Australian Dollar.

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